'Super complaint' against card transaction charges launched

Extortionate: the cost to retailers is a maximum of 2% per transaction, but some are currently charging customers far more

A "super complaint" against the surcharges imposed on customers who pay with a debit or credit card is to be launched.

Consumer watchdog Which? is calling on the Office of Fair Trading (OFT) to investigate the charges, saying they are often "sprung" on the customer at the point of payment and could be far in excess of what it costs the retailer to process the transaction.

It claims low-cost airlines are among the worst offenders, with some charging a fee per passenger per leg of the journey, in spite of them having to process just one transaction.

Which? said it believed the actual cost to the retailer was no more than 20p for a debit card transaction or a percentage of a credit card transaction, thought to be no more than 2%.

However, charges to the consumer are often a fixed amount or can increase based on the number of people buying tickets.

Local authorities, estate agents, cinemas and even the DVLA were beginning to levy excessive charges for paying by card, Which? said.

Which? said it wanted retailers to tell consumers about any surcharges upfront "in plain language" in their advertising and promotions.

It also wants fees to match the actual cost to retailers, or for retailers to absorb the "very small" cost of debit card transactions.

"Paying by card should cost the consumer the same amount that it costs the retailer. Companies shouldn't be using card processing costs as an excuse for boosting their profits.

"Low-cost airlines are some of the worst offenders when it comes to excessive card surcharges but this murky practice is becoming ever more widespread, from cinemas to hotels and even some local authorities."

The OFT has 90 days to respond once Which? has filed its complaint.

Consumer Focus head of fair markets Prashant Vaze said: "Consumers are fed up with paying these surcharges. Often they have no other option, especially for internet transactions where there is no alternative to using cards. The worst offenders even ask for surcharges on a per person basis.

"Any debit or credit card charge should only be cost-reflective. For far too long firms have made a quick buck through confusing and unfair card charges which bear no relationship to the costs levied by payment agencies.

"We hope the Which? super-complaint forces the OFT to take further action against companies padding their profits with unfair excess charges."